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20-0422 Wednesday “Daily Bugle”

20-0422 Wednesday “Daily Bugle”

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Wednesday, 22 April 2020

  1. DHS/CBP Extends Deadlines for Certain Estimated Payments
  2. Justice/ATF Requests Comments on ATF Form 2300.10, Special Agent Medical Preplacement
  1. Items Scheduled for Future Federal Register Edition
  2. Commerce/BIS: (No new postings.)
  3. DHS/CBP: “Information for Filing PPE and Medical Devices During COVID-19”
  4. State/DDTC: (No new postings.)
  5. Treasury/OFAC Issues Venezuela General License 8F
  6. Netherlands TCA Extends Time Limit to Re-import Cultural Goods
  1. Export Compliance Daily: “African Apparel Exporters Tell USTR What Kenya FTA Should Include”
  2. ST&R Trade Report: “Update on Trade Agency Operations in Response to Pandemic”
  1. EU Sanctions: “Self-Disclosures of Arms Exports Violations to US DDTC Declines”
  2. Kelley Drye: “CBP Posts Interim Instructions for USMCA Implementation”
  3. Kirkland & Ellis: “Considerations When Postponing Payment of Import Duties Due to COVID-19”
  4. LexSage: “Canada Updates Export Control List”
  5. Thompson Hine: “FEMA Announces Additional Exemptions to Export Restrictions on PPE”
  6. Wilmer Hale: “COVID-19: President Trump Authorizes Temporary Deferral of Some Import Duties”
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OGSITEMS FROM TODAY’S FEDERAL REGISTER

EXIM_a21
. DHS/CBP Extends Deadlines for Certain Estimated Payments

(Source: Federal Register, 22 Apr 2020) [Excerpts]

85 FR 22349: Temporary final rule.
 
* AGENCY: U.S. Customs and Border Protection, Department of Homeland Security; Department of the Treasury.
* ACTION: Temporary final rule.
* SUMMARY: In light of the President’s Proclamation Declaring a National Emergency Concerning the Novel Coronavirus Disease (COVID-19) (Presidential Proclamation 9994) under the National Emergencies Act on March 13, 2020, and the President’s Executive Order entitled ”National Emergency Authority to Temporarily Extend Deadlines for Certain Estimated Payments” authorizing the Secretary of the Treasury to exercise the authority under section 318(a) of the Tariff Act of 1930, issued on April 18, 2020, the Secretary of the Treasury, in consultation with the designee of the Secretary of Homeland Security (U.S.
Customs and Border Protection (CBP)), is amending the CBP regulations to temporarily postpone the deadline for importers of record with a significant financial hardship to deposit certain estimated duties, taxes, and fees that they would ordinarily be obligated to pay as of the date of entry, or withdrawal from warehouse, for consumption, for merchandise entered in March or April 2020, for a period of 90 days from the date that the deposit would otherwise have been due but for this emergency action.  
    This temporary postponement does not permit return of any deposits of estimated duties, taxes, and/or fees that have been paid. This temporary postponement also does not apply to entries, or withdrawals from warehouse, subject to certain specified trade remedies, and any entry summary that includes merchandise subject to hose trade remedies is not eligible under this rule.


* DATES: Effective date: April 20, 2020. Comments must be received by May 20, 2020. … 

 
* * * * * * * * * * * * * * * * * * * *  

EXIM_a12
. Justice/ATF Requests Comments on ATF Form 2300.10, Special Agent Medical Preplacement

(Source: Federal Register, 22 Apr 2020) [Excerpts]

85 FR 22444: 30-Day notice.
* AGENCY: Bureau of Alcohol, Tobacco, Firearms and Explosives, Department of Justice. 
* ACTION: 30-Day notice.

* SUMMARY: The Department of Justice (DOJ), Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), will submit the following information collection request to the Office of Management and Budget (OMB) for review and approval in accordance with the Paperwork Reduction Act of 1995.  

*DATES: Comments are encouraged and will be accepted for an additional 30 days until May 22, 2020. …  

 
* * * * * * * * * * * * * * * * * * * *  

OGSOTHER GOVERNMENT SOURCES

OGS_a13.
Items Scheduled for Future Federal Register Editions 
[No items of interest today.] 

 
* * * * * * * * * * * * * * * * * * * *  

OGS_a24. 
Commerce/BIS: (No new postings.)

 
* * * * * * * * * * * * * * * * * * * *  

OGS_a35.
DHS/CBP: “Information for Filing PPE and Medical Devices During COVID-19”

(Source: DHS/CBP, 21 Apr 2020)  
 
The U.S. Food and Drug Administration is providing an update to CSMS messages 42124872 and 42168200 for instructions to the import community regarding the submission of entry information for personal protective equipment and certain other devices. Following the instructions below will help facilitate the import process for all; especially for products related to the Coronavirus Disease-2019 (COVID-19) public health emergency. It is in the best interest of the U.S. to facilitate and expedite the importation of products into the U.S. market that address immediate, urgent public health needs.
Because this a very fluid situation and FDA policy for these products are updated regularly, for the most up to date information on entry submission visit the FDA website: Information for Filing Personal Protective Equipment and Medical Devices During COVID-19.
 
Non-FDA-regulated general purpose personal protective equipment (masks, respirators, gloves, etc.)
Personal protective equipment for general purpose or industrial use (that is, products that are not intended for use to prevent disease or illness) is not regulated by FDA.
For these types of products, entry information should not be transmitted to FDA. At the time of entry for these products, Importers should transmit entry information to US Customs and Border Protection (CBP) using an appropriate HTS code with no FD Flag; or using an appropriate HTS code with an FD1 flag and do a ‘disclaim’ for FDA.
 
Products authorized for emergency use pursuant to an Emergency Use Authorization (EUA)
When importing such products, entry information should be submitted to FDA; however reduced FDA information is required for review.
At the time of entry, Importers should transmit an Intended Use Code of 940.000: Compassionate Use/Emergency Use Device, and an appropriate FDA product code.  Under this Intended Use Code, the Affirmations of Compliance for medical devices (such as the Registration, Listing, and Premarket numbers) are optional in ACE.
Below is a list of products and certain product codes authorized by an EUA. A complete list of product codes may be found in corresponding enforcement policy guidance documents identified below.
 

 
(1)
Non-NIOSH-Approved Respirators: 80QKU

  (2)
NIOSH-Approved Respirators
  (3)
Face Masks (Non-Surgical)
  (4)
Diagnostic Tests Kits
  (5)
Ventilators
  (6)
Face Shields
  (7)
Respirator Decontamination Systems
  (8)
Extracorporeal Blood Purification Devices
  (9)
Infusion Pumps
  (10)
Ventilators
  (11)
Diaphragmatic Pacing Simulator Systems

 
A full list of Emergency Use Authorizations currently in place for the COVID-19 emergency is also available on the FDA’s website.  Please check this site regularly for current information on products authorized by an EUA. Future updates to this message will only identify new EUAs in this section. The full list will be provided on the FDA website: Information for Filing Personal Protective Equipment and Medical Devices During COVID-19.  
 
Products regulated by FDA as a device, not authorized by an EUA, but where an enforcement discretion policy has been published in guidance.
When importing such devices, entry information should be submitted to FDA.
At the time of entry, Importers should transmit Intended Use Code 081.006: Enforcement discretion per final guidance, and an appropriate FDA product code.  Under this Intended Use Code, the Affirmations of Compliance for medical devices (such as the Registration, Listing, and Premarket numbers) are optional in ACE. 
Below is a listing of guidance documents that have been issued for specific products related to COVID-19, which reference applicable product codes and policy for those products:
   
 
A full list of all guidance documents related to COVID-19 is also available on FDA’s website.  For guidance applicable to medical devices, you may filter by the medical device product area and display all entries.  Please check this site, as well as Information for Filing Personal Protective Equipment and Medical Devices During COVID-19, regularly for current information on these and other product areas. …

 
* * * * * * * * * * * * * * * * * * * *  

 
* * * * * * * * * * * * * * * * * * * *  

OGS_a57. 
Treasury/OFAC Issues Venezuela General License 8F
(Source:
Treasury/OFAC, 21 Apr 2020)
 
The Department of the Treasury’s Office of Foreign Assets Control (OFAC) is issuing General License 8F “Authorizing Transactions Involving Petróleos de Venezuela, S.A. (PdVSA) Necessary for the Limited Maintenance of Essential Operations in Venezuela or the Wind Down of Operations in Venezuela for Certain Entities.”

 
* * * * * * * * * * * * * * * * * * * *  

OGS_a68. 
Netherlands TCA Extends Time Limit to Reimport Cultural Goods
 
Did you export cultural goods with an authorisation? Further to the corona crisis, it is not always possible that the goods return in time. The date specified in the authorisation cannot be met due to the amended rules and regulations for air cargo and freight traffic. You may apply for an extension of the authorisation to the Central Import and Export Office (CDIU).
 
CDIU and the Government Information and Heritage Inspectorate advise you to apply for an extension in a timely fashion which means that you can continue to comply with the obligation of reimportation.
 
This is how you apply for an extension of your export authorization:
Send an E-mail to CDIU: drn-cdiu.groningen@belastingdienst.nl
 
Please state the number of the export authorisation in your application. We will send you an authorisation as soon as possible together with a new date by which the goods must have returned to the Netherlands.

 
* * * * * * * * * * * * * * * * * * * *  

COMNEWS

NWS_a19. Export Compliance Daily: “African Apparel Exporters Tell USTR What Kenya FTA Should Include”

NWS_a210. ST&R Trade Report:

“Update on Trade Agency Operations in Response to Pandemic”


(Source: Sandler, Travis & Rosenberg Trade Report, 22 Apr 2020) [Excerpts]

 
Federal trade regulatory agencies have recently announced the following with regard to their operations in response to the COVID-19 pandemic. For more information, please contact trade attorney 
Lenny Feldman
 at (305) 894-1011. In addition, Sandler, Travis & Rosenberg has launched a 
new resource page
 to help members of the trade community keep track of the latest COVID-related policies and procedures and understand how best to respond.
Department of Agriculture
Effective April 20 for a period of 60 days, the USDA’s Agricultural Marketing Service will not take enforcement action against the retail sale of commodities that lack an appropriate country of origin or method of production label, provided that the food does not make any country of origin or method of production claims.
Ordinarily, commodities subject to country of origin labeling requirements (muscle cut and ground meats: lamb, goat, and chicken; wild and farm-raised fish and shellfish; fresh and frozen fruits and vegetables; peanuts, pecans, and macadamia nuts; and ginseng) are not required to include a country of origin or method of production label when distributed to foodservice. Such labels are usually required when these foods are sold at retail establishments.
By exercising enforcement discretion concerning the latter requirement, APHIS is allowing food to be diverted from restaurants to retail establishments, which are currently experiencing greater demand.
Export-Import Bank

EXIM approved April 14 a resolution to temporarily exclude from EXIM coverage or financing any exports of critically-needed personal protective equipment and other medical supplies and equipment. 

International Trade Commission

The ITC has 
instituted an investigation
 
that will identify imported goods related to the COVID-19 response and their source countries, tariff classifications, and applicable duty rates. The ITC’s report in this investigation is due by April 30.
In addition, the ITC has extended until June 10 its postponement of all in-person hearings in Section 337 intellectual property infringement proceedings.

Office of Foreign Assets Control

OFAC has issued 
a guidance document
 
highlighting the most relevant exemptions, exceptions, and authorizations for humanitarian assistance and trade under the OFAC-administered sanctions programs for Iran, Venezuela, North Korea, Syria, Cuba, and Ukraine/Russia.
Separately, OFAC encourages persons affected by the COVID-19 global pandemic, including financial institutions and other businesses, to contact OFAC as soon as practicable if they believe they may experience delays in their ability to meet deadlines associated with regulatory requirements administered by OFAC. This includes requirements related to filing blocking and reject reports within ten business days, responses to administrative subpoenas, reports required by general or specific licenses, or any other required reports or submissions. OFAC explains that if a business chooses to respond to technical and resource challenges caused by the pandemic by temporarily reallocating sanctions compliance resources as part of a risk-based approach to compliance, this will be evaluated as a factor in determining the appropriate administrative response to an apparent violation that occurs during this period.

COMCOMMENTARY

COM_a111. 
EU Sanctions: “Self-Disclosures of Arms Exports Violations to US DDTC Declines”
(Source: 
EU Sanctions, 20 Apr 2020)
 
* Principal Author: 
Maya Lester, QC., 44-20-7379-3550, Brick Court Chambers
 
The US State Department’s Directorate of Defence Trade Controls (DDTC), which oversees controls over military exports, has seen a decline in the number of voluntary self-disclosures received from 2027 in 2013 to 654 in 2019 (figures obtained by Global Investigations Review, see 
article). The statistics have remained consistent for the past 2 years after falling from over 500 in 2013/2014, and then by approximately 140 self-disclosures per year since 2014 (not including directed disclosures, the numbers of which have stayed consistent). The DDTC has said that the decrease in self-reports stems from the removal of dual-use items from the DDTC-regulated Munitions List to a register of sensitive items regulated by the US Commerce Department.

COM_a212. Kelley Drye: “CBP Posts Interim Instructions for USMCA Implementation”

(Source: Kelley Drye, 21 Apr 2020)
 
 
On Monday, April 20, 2020, U.S. Customs and Border Protection (CBP) issued interim instructions for implementation of the U.S.-Mexico-Canada Agreement (USMCA).  The instructions provide guidance regarding preferential tariff claims under the USMCA.  The Agreement, once it enters into force, provides for the immediate or staged elimination of trade barriers for goods originating in one of the three countries.  The instructions provide guidance regarding rules of origin (including for automotive goods), regional value content (RCV) calculation methods, de minimis rules, transshipment, eligibility for textiles and apparel, making preference claims, and certification and recordkeeping rules and requirements.
The instructions provide a rules of origin definition to determine whether a good qualifies as an “originating good” under the USMCA, such that it is eligible for preferential tariff treatment.  Under USMCA a good is “originating” in the United States, Mexico, or Canada when:
a) The good is wholly obtained or produced entirely in the territory of one or more of the Parties, as defined in Article 4.3 of the Agreement;
b) The good is produced entirely in the territory of one or more of the Parties using non-originating materials provided the good satisfies all applicable requirements of product- specific rules of origin;
c) The good is produced entirely in the territory of one or more of the Parties exclusively from originating materials; or
d) Except for a good provided for in Chapter 61 to 63, HTSUS:
the good is produced entirely in the territory of one or more of the Parties, is classified with its materials or satisfies the “unassembled goods” requirement, and meets a regional value content threshold of not less than 60% if the transaction value method is used or not less than 50% if the net cost method is used (not including RVC for autos); and
e) The good satisfies all other applicable origin requirements.
The instructions provide two Regional Value Content (RVC) calculation methods – the transaction value method and the net cost method.  For most goods, and with certain exceptions, the USMCA provides for a 10 percent de minimis threshold, meaning that a good is considered an originating good if the value of any non-originating materials used to produce the good do not exceed 10 percent of either the transaction value of the good or the total cost of the good.
USMCA includes substantial new rules governing the rules of origin for automotive goods.  The agreement increase the RVC rule for automotive goods by requiring that 75 percent of auto content be made in North America.  At least 70 percent of an auto producer’s use of steel and aluminum must also originate in North America.  The interim instructions further explain the alternative staging regime included in USMCA that implements the new auto goods rules.  It provides that a passenger vehicle or light truck may be considered originating until the later of January 1, 2025 or five years after entry into force of the agreement.  To be eligible for the alternative staging regime, the passenger vehicle or light truck must be numerous requirements, including a RVC that is not lower than 62.5 percent (using the net cost calculation method) and must be 75 percent by the later of January 1, 2025 or five years after entry into force of the agreement.  Appendix 1 of the interim instructions includes certification procedures for automotive goods.
The instructions indicate that the U.S. Department of Labor will issue separate regulations regarding certain components of the labor value content requirements.
When the USMCA will enter into force, and officially replace the 1994 North American Free Trade Agreement (NAFTA) between the three countries, remains unclear.  The USMCA was signed into law on January 29, 2020, and was ratified on March 13, 2020.  Currently, the Administration plans for the agreement enter into force on June 1, 2020.  However, a number of parties in all three countries, including a group of U.S. senators, is calling for a delayed entry into force of the agreement in light of the COVID-19 pandemic.

COM_a313. Kirkland & Ellis: “Considerations When Postponing Payment of Import Duties Due to COVID-19” 

(Source:
Kirkland & Ellis, 21 Apr 2020) 
 
* Principal Author: 
Mario Mancuso, Esq., 1-202-389-5070, Kirkland & Ellis LLP 
 
On April 19, 2020, U.S. Customs and Border Protection (“CBP”), the Department of Homeland Security, and the Department of the Treasury issued a
 
temporary final rule (the “Rule”) permitting importers to postpone payment of certain import duties for 90 days to help offset the impacts of COVID-19. As the Rule does not create a blanket authorization to postpone payment of all duties, taxes and fees, it is important to examine the criteria carefully.
Though the Rule comes on the heels of President Trump’s April 18, 2020, Executive Order, CBP has considered granting some form of import relief for more than a month. On March 20, CBP announced authorization of case-by-case review of extension requests for payment of duties, taxes and fees due to the effects of COVID-19, but overturned the authorization only a few days later. The Rule reflects CBP’s ongoing process as it attempts to strike a balance between providing some relief to companies suffering significant financial hardship from COVID-19 while retaining certain protective duties that are considered critical to the Administration’s trade policy.
Below are five considerations for importers in assessing whether they may postpone import duty payments:
  (1) The Rule applies only to merchandise entered in March and April 2020. For qualified imported merchandise entered into the United States only from March 1 to April 30, 2020, importers can delay payment of duties, taxes and fees by 90 days. 
  (2) Importers cannot get refunds for payments already made. If an importer has already paid duties for entries in March and April 2020, CBP is not permitted to return such payments. 
  (3) The Rule excludes merchandise subject to antidumping duties, countervailing duties, or to Section 201, 232, or 301 tariffs. If the entry summary for a particular entry includes merchandise that is subject to antidumping duties, countervailing duties, or Section 201, 232, or 301 tariffs, the entire entry cannot benefit from the Rule, and the importer must pay all duties, taxes and fees on time. 
  (4) Importers can split shipments into more than one entry to take advantage of the Rule for qualified merchandise. CBP indicated in the Rule that it anticipates importers will “file separate entries” for merchandise in a shipment that is eligible for postponement under the Rule and merchandise that is not eligible. 
  (5) The importer must be subject to “significant financial hardship.” An importer must have at least partially suspended its operations during March or April 2020 due to orders from a governmental authority limiting commerce because of COVID-19. In addition, the gross receipts for March 13-31 or the month of April must be less than 60% of the gross receipts for such period in 2019. The importer does not need to provide CBP with evidence in its import documentation, but must keep such information in its records.
These criteria can involve various nuances, including how to determine the entry date and overall eligibility based on applicable duties. Properly completing entry documentation will also be critical to maximizing the merchandise that qualifies for postponement. Importers should therefore consult specialist counsel or their customs broker regarding applicability of the Rule.

COM_a414.

LexSage: “Canada Updates Export Control List”

(Source:
LexSage, 15 Apr 2020) 
 
* Principal Author: 
Cyndee Todgham Cherniak, Esq., 647-290-4249, LexSage
 
On April 1, 2020, the Government of 
Canada published in the Canada Gazette “An Order Amending the Export Control List”, SOR/2020-48 (P.C. 2020-140).  This Order takes effect on May 1, 2020. The objective of this Order is to implement in Canadian law the Government of Canada’s arrangements, commitments and policies resulting from Canada’s participation in the Wassenaar Arrangement on Export Controls for Conventional Arms and Dual-Use Goods and Technologies, the Nuclear Suppliers Group, the Missile Technology Control Regime and the Australia Group, up to December 31, 2018.
 
The amendments to Canada’s Export Control List include:
  (1) Updating the definition of “Guide” to refer to the latest version of the guide – being A Guide to Canada’s Export Control List – December 2018, published by the Department of Foreign Affairs, Trade and Development.  This Guide is not available on the Global Affairs website.  The 2016 version of A Guide to Canada’s Export Control List is available. In August 2019, Global Affairs Canada posted the 
Export and brokering controls handbook, which is different from A Guide to Canada’s Export Control List. Also, Canada no longer refers to a department as the “Department of Foreign Affairs, Trade and Development” in Canada.  So, this amendment seems to contain an error.

 
The December 2018 version of the Guide to Canada’s Export Control List adds the following items:
  • Group 1: magnetic random-access memories (MRAMs), high power discrete microwave transistors, electro-optic modulators, mask substrate blanks, software designed to restore microprocessors after electro-magnetic pulse or electrostatic discharge, and read-out integrated circuits;
  • Group 2: two explosive materials, a binder material, vessels for delivery of divers, and naval nuclear equipment;
  • Group 4: target assemblies and components for the production of tritium; and
  • Group 7: prefabricated repair assemblies and components for reaction vessels and storage tanks, CWC Sched-ule 2B precursors, and nucleic acid assemblers and synthesizers.
The December 2018 version of the Guide to Canada’s Export Control List adds the following items:
  • Group 1: robots capable of full three-dimensional image processing in real time, linear position feedback units, rotary position feedback units, technology for the development of interactive graphics, and high-speed cinema recording cameras;
  • Group 2: aero-engines manufactured before 1946; and
  • Group 4: water-hydrogen sulphide exchange tray columns.
The 2018 Version of the Guide clarifies, either through grammatical edits or technical notes, the following controls:
  • Group 1: Composite structures and laminates, materials designed for absorbing near infrared radiation, standard for ball bearings, numerically controlled machine tools, dimensional inspection or measuring systems, compound rotary tables, digital-to-analogue converters, high-energy devices, signal generators, high resistivity materials, software for digital computers, information security systems, hydrophones, lasers, unmanned submersible vehicles, underwater vision systems, marine gas turbine engines, telemetry and telecommand equipment, and software for testing aero gas turbine engines;
  • Group 2: Accessories designed for arms, ground vehicles and components, diesel engines for submarines, and intermodal containers for military use;
  • Group 3: Irradiated fuel element decladding equipment; and
  • Group 6: Turbojet and turbofan engines, batch and continuous mixers, and propellant substances.  
  (2) Updating the definition of “Wassenaar Agreeement” to mean ” the Wassenaar Arrangement on Export Controls for Conventional Arms and Dual-Use Goods and Technologies that was reached at the Plenary Meeting in Vienna, Austria, held on July 11and 12, 1996, and amended by WA-LIST (18) 1 at the Plenary Meeting in Vienna, Austria, held on December 5 and 6, 2018.”
 
  (3) Updating paragraph 3 of Group 3 to refer to Guidelines for Nuclear Transfers (INFCIRC/254/Rev.13/Part 1a), issued by the Nuclear Suppliers Group and adopted at the Plenary Meeting held on June 14 and 15, 2018.
 
  (4) Updating paragraph 3 of Group 3 and 4 to refer to Guidelines for Transfers of Nuclear-Related Dual-Use Equipment, Materials, Software, and Related Technology (INFCIRC/254/Rev.10/Part 2a), issued by the Nuclear Suppliers Group and adopted at the Plenary Meeting held on June 14 and 15, 2018.
 
  (5) Updating Group 6: Missile Technology Control Regime description to refer the MTCR/TEM/2018/Annex of November 30, 2018 that was adopted at the Reinforced Point of Contact Meeting held on December 18and 19, 2018.
 
  (6) Updating paragraph (a) of Group 7 description to refer to amendments the Guidelines for Transfers of Sensitive Chemical or Biological Items, issued by the Australia Group to control the export of chemical and biological weapons, the list of which occurred at the Plenary Meeting held from June 4 to 8, 2018.

COM_a515. Thompson Hine: “FEMA Announces Additional Exemptions to Export Restrictions on PPE”

(Source:
Trump and Trade
, 21 Apr 2020)
 
* Principal Author:
Scott E. Diamond, Esq., 1-202-263-4197, Thompson Hine
 
On April 17, 2020, the Federal Emergency Management Agency’s (FEMA) filed a
notification of exemptions (the “Exemptions”) that identifies 10 exemptions from the temporary final rule published on April 10, 2020 (the “Rule”), which restricts the export from the United States of certain personal protective equipment (PPE) and respirators in the response to the COVID-19 pandemic. On April 21, 2020 the Exemptions were published in the Federal Register and became effective on April 17.
 
The Rule
imposes export restrictions on certain PPE and respirators (“Covered Products”) pursuant to a Presidential Memorandum dated April 3, 2020. The Rule directs U.S. Customs and Border Protection (CBP) to detain any shipments of the Covered Products pending FEMA’s determination whether to return such shipments for domestic use, issue a rated order for the products, or allow the export of part of all of the shipment.
 
Previously, the Rule contained only one narrow exemption for shipments by or on behalf of U.S. manufacturers with continuous export agreements with foreign customers since January 1, 2020, and a track record of distributing at least 80% of their supply of the Covered Products, on a per item basis, in the United States during the preceding 12 months. Effective April 17, 2020, the following shipments of Covered Products are also exempt from the Rule:
 
(1) Shipments to US commonwealths and territories, including Guam, American Samoa, Puerto Rico, US Virgin Islands, and the Commonwealth of the Northern Mariana Islands (including minor outlying islands).
 
(2) Exports by non-profit or non-governmental organizations that are solely for donation to foreign charities or governments for free distribution (not sale) at their destination(s).
 
(3) Intracompany transfers by U.S. companies from domestic facilities to company-owned or affiliated foreign facilities.
 
(4) Shipments of Covered Products exported solely for assembly in medical kits and diagnostic testing kits destined for U.S. sale and delivery.
 
(5) Sealed, sterile medical kits and diagnostic testing kits where only a portion of the kit is made up of one or more Covered Products that cannot be easily removed without damaging the kits.
 
(6) Declared diplomatic shipments from foreign embassies and consulates to their home countries, shipped from and consigned to foreign governments (may be shipped via intermediaries).
 
(7) Shipments to overseas US military addresses, foreign service posts (e.g., diplomatic post offices,) and embassies.
 
(8) In-transit merchandise such as shipments in transit through the United States with a foreign shipper and consignee and shipments temporarily entered into a warehouse or temporarily admitted to a foreign trade zone.
 
(9) Shipments for which the final destination is Canada or Mexico.
 
(10) Shipments by or on behalf of the U.S. federal government, including its military.
 
Each of the Exemptions includes additional details on their scope and the basis for each exemption. Notably, Exemptions (2), (3), (4), (8), and (9) require that exporters submit a letter of attestation to FEMA via CBP’s document imaging system certifying the purpose of the shipment. The letter must also include the following information:
 
(i) a description of which Exemption the exporter is claiming;
 
(ii) details regarding the shipment sufficient for CBP and FEMA officials to determine whether the shipment falls under the claimed Exemption(s); and
 
(iii) a statement that the information provides is true and accurate to the best of the exporter’s knowledge, and that the exporter is aware that false information is subject to prosecution under the Defense Production Act.
 
In the Exemptions, FEMA has directed CBP to detain shipments of any manufacturer, broker, distributor, exporter or shipper that CBP believes “is intentionally modifying shipments in a way to take advantage of one or more of these exemptions, diverting materials from the U.S. market or is otherwise trying to circumvent the export restrictions.”
 
FEMA will make its determination as to each shipment based on the letters of attestation submitted, the Exemptions, and the “totality of the circumstances” described in the Rule.

COM_a616. Wilmer Hale: “COVID-19: President Trump Authorizes Temporary Deferral of Some Import Duties”

(Source:
Wilmer Hale
, 21 Apr 2020)
 
 
On April 19, 2020, President Trump issued an Executive Order (E.O.) on “National Emergency Authority to Temporarily Extend Deadlines for Certain Estimated Payments” directing the Secretary of the Treasury, in consultation with the Secretary of Homeland Security, to take appropriate action to temporarily extend deadlines “for importers suffering significant financial hardship because of COVID-19.” U.S. Customs and Border Protection (CBP) and the Department of the Treasury issued an interim final rule (IFR) the same day amending CBP regulations (19 C.F.R. part 24) to implement the E.O.
 
The IFR allows qualifying importers to defer payment of certain estimated duties, taxes and/or fees for 90 calendar days with respect to eligible merchandise entered into or withdrawn from warehouse for consumption (including entries for consumption from a Foreign Trade Zone) in March or April 2020. No interest will accrue for the postponed payment.
 
To qualify for the temporary payment postponement for eligible merchandise, an importer of record must demonstrate a “significant financial hardship.” An importer will be considered to have a significant financial hardship if (i) its operations were fully or partially suspended during March or April 2020 due to orders from a competent governmental authority limiting commerce, travel or group meetings because of COVID-19; and (ii) as a result of such suspension, the gross receipts of such importer for March 13-31, 2020, or April 2020 are less than 60 percent of the gross receipts for the comparable period in 2019. The importer is not required to file any additional documentation with CBP to be eligible for temporary relief, but it must maintain adequate documentation in case CBP requests a review.
 
The IFR contains a number of key limitations. Notably, the temporary postponement does not apply to merchandise subject to additional duties beyond the standard rate in the US Harmonized Tariff Schedule, including:
 
  (a) antidumping duties;
countervailing duties;
  (b) “Section 232” duties,1 such as those currently applicable to imports of steel and aluminum;
  (c) “Section 201” duties,2 such as those currently applicable to imports of solar panels; and
  (d) “Section 301” duties,3 such as those currently applicable to imports of Chinese-origin goods.
 
If a particular entry contains both eligible and ineligible merchandise, the entire entry will not be eligible for the 90-day postponed payment. In such circumstances, importers should file separate entries for the two categories of merchandise.
 
Other limitations also apply. For example, the temporary postponement does not cover deadlines for the payment of other debts to CBP, including but not limited to deadlines for the payment of bills for duties, taxes, fees and interest determined to be due upon liquidation or reliquidation, or deadlines for the payment of any penalty or liquidated damages due to CBP. The IFR also indicates that CBP will not return deposits of estimated duties, taxes and/or fees that have already been paid.
 
Although the IFR is effective as of April 20, CBP is accepting comments on it through May 20, 2020.
 
CBP issued the following two notices on April 19 offering further guidance on the temporary postponement:
 
CSMS #42423171: COVID-19-90 Day Postponement of Payment for the Deposit of Certain Estimated Duties, Taxes, and Fees. This notice summarizes in detail eligibility requirements for postponement of import payments, as well as information on making payments.
CSMS #42421561: COVID-19-Payment Instructions for 90-Day Postponement of Payment for the Deposit of Certain Estimated Duties, Taxes, and Fees. This notice expands on the payment instructions provided in CSMS #42423171.

TEEX/IM TRAINING EVENTS & CONFERENCES

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17. E
CTI Presents: e-Seminar sale – 20% off all e-Seminar Training

(Source: ECTI)
* What:
e-Seminar Training Sale – 20% off with code: 
stayhome
* When:
Now through 15 of May
* Where:
Online training – delivered electronically on USB
* Sponsor: Export Compliance Training Institute (ECTI)
* Register: here
, or contact 1-540-433-3977


* * * * * * * * * * * * * * * * * * * *

* What: Hitting the Mark – Classification under the Harmonized System & Schedule B Code
* When: 14 May, 2020; 1:00 p.m. (EDT)
* Where: Webinar
* Sponsor: Export Compliance Training Institute (ECTI)
* ECTI Speaker: Melissa Proctor
* Register:
here
or contact Ashleigh Foor, 1-540-433-3977.

* * * * * * * * * * * * * * * * * * * *

TE_a3
19. FCC Academy Presents Webinar: “An Introduction to EU/Dutch Dual-use and Military Export Controls“; 12 May

 
* What: Introduction to EU / Dutch Dual-Use and Military Export Controls
* When: 12 May 
* Where:  Online
* Sponsor: FCC Academy 
* Presenter: Marco F.N. Crombach MSc (Director)
* Register: 

here
, and email
 events@fullcirclecompliance.eu

* * * * * * * * * * * * * * * * * * * *

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20.
FCC Academy
Presents June Webinars
: U.S. Export Controls: ITAR, EAR, and FMS

ENEDITOR’S NOTES

* * * * * * * * * * * * * * * * * * * *

The official versions of the following regulations are published annually in the U.S. Code of Federal Regulations (C.F.R.), but are updated as amended in the Federal Register.  The latest amendments are listed below.
 
Agency 
Regulations 
Latest Update 
DHS CUSTOMS REGULATIONS
: 19 CFR, Ch. 1, Pts. 0-199.
 
 
 
5 Apr 2019:84 FR 13499: Civil Monetary Penalty Adjustments for Inflation.

DOC EXPORT ADMINISTRATION REGULATIONS (EAR): 15 CFR Subtit. B, Ch. VII, Pts. 730-774.

24 Feb 2020:
85 FR 10274
: Amendments to Country Groups for Russia and Yemen Under the Export Administration Regulations.
 

 

DOC FOREIGN TRADE REGULATIONS (FTR): 15 CFR Part 30.   Last Amendment: 24 Apr 2018: 83 FR 17749: Foreign Trade Regulations (FTR): Clarification on the Collection and Confidentiality of Kimberley Process Certificates.

DOD NATIONAL INDUSTRIAL SECURITY PROGRAM OPERATING MANUAL (NISPOM): DoD 5220.22-M. Implemented by Dep’t of Defense.

18 May 2016: Change 2: Implement an insider threat program; reporting requirements for Cleared Defense Contractors; alignment with Federal standards for classified information systems; incorporated and cancelled Supp. 1 to the NISPOM (Summary here.)  
DOE ASSISTANCE TO FOREIGN ATOMIC ENERGY ACTIVITIES: 10 CFR Part 810. 

23 Feb 2015: 80 FR 9359, comprehensive updating of regulations, updates the activities and technologies subject to specific authorization and DOE reporting requirements. 
DOE EXPORT AND IMPORT OF NUCLEAR EQUIPMENT AND MATERIAL; 10 CFR Part 110.

15 Nov 2017, 82 FR 52823: miscellaneous corrections include correcting references, an address and a misspelling.

 

DOJ ATF ARMS IMPORT REGULATIONS: 27 CFR Part 447-Importation of Arms, Ammunition, and Implements of War.

14 Mar 2019: 84 FR 9239: Bump-Stock-Type Devices.

DOS INTERNATIONAL TRAFFIC IN ARMS REGULATIONS (ITAR): 22 C.F.R. Ch. I, Subch. M, Pts. 120-130.  26 Dec 2019: 84 FR 70887; 23 Jan 2020: 85 FR 3819: Encryption rule and USML Categories I, II, III, and related sections regarding guns & ammo. 
DOT FOREIGN ASSETS CONTROL REGULATIONS (OFAC FACR): 31 CFR, Parts 500-599, Embargoes, Sanctions, Executive Orders

13 Mar 2020:
85 FR 14572:
General Licenses Issued Pursuant to Venezuela-Related Executive Order 13835.

 
 
 
 
USITC HARMONIZED TARIFF SCHEDULE OF THE UNITED STATES (HTS, HTSA or HTSUSA),

1 Jan 2019: 19 USC 1202 Annex.
  – HTS codes for AES are available here.
  – HTS codes that are not valid for AES are available here.
 

* * * * * * * * * * * * * * * * * * * *
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